The XLE Energy ETF, banged up after years of low oil prices, has begun to show signs of life. It is up 10 percent in April, looking to close the month with its best gains since October 2015. Over the past two weeks, the ETF has risen above its 50-day, 100-day and 200-day moving average.

"I think the next stop for the XLE is going to be $78 which is the old highs we've tested twice before so I think we're going to run up to that," said Johnson.

The XLE last touched $78 during the broader market rally in late January. It is currently 5 percent from that level.

This month's surge has dragged the energy sector into the green for the year. Before April, it was one of the worst performers in the S&P 500.

The XLE's underperformance was largely tied to weakness in Chevron and Exxon Mobil, the ETF's largest weightings. Excluding those two stocks, the XLE would be up more than 7 percent so far this year, said Johnson, far better than its current 3 percent increase.

"We're overweight the space," said Johnson. "We'd continue to be buying the names, not Chevron or Exxon, but we do like things like ConocoPhillips and some of the other names and even the refiners. We think there's lots of leverage in there."

"For most of the year the companies have dramatically underperformed the commodity, but over the last month there's a real catch-up going on," McDonald told "Trading Nation" on Friday.

Oil prices have rocketed nearly 13 percent higher so far this year, while the energy ETF has risen by roughly a quarter of that. Crude is on track to close April with gains of nearly 5 percent, its seventh monthly increase in eight months.

As stocks and bonds have come under pressure this year, McDonald sees a shift in holdings toward the underowned commodity and energy space.

"The flight out of stocks and bonds will move toward commodities, toward energy names and you're talking potentially a trillion dollars over the next year and a half, two years," said McDonald. "So back up the truck, the energy space, the XLE, XLP are screaming buys right here."